ConversationScott McLaughlinSenior Vice President of Investor Relations & Tax Good afternoon, everyone, and welcome to Invitation Homes' 2025 Investor Day. I'm Scott McLaughlin, Head of Investor Relations. It's great to see many of you again, including many of our largest stockholders, along with our esteemed sell-side community. Today is about transparency, engagement and execution giving you a clear view of where we're headed and how we plan to get there. Before we dive into all that, let's just take a ...

Core Insights - The shift in focus from property price appreciation to rental income generation is evident among investors, with a growing emphasis on monthly rental returns and payback periods [1][22]. Group 1: Investor Behavior - Investors like Zhang Qiang are now prioritizing rental income over capital gains, indicating a change in investment strategy in the real estate market [1][22]. - The trend shows that individuals are more cautious and prefer properties that can provide stable rental income, especially in uncertain economic conditions [22][30]. Group 2: Market Dynamics - There is a notable demand for small, affordable properties with high rental yields, as evidenced by the increased transaction volume of units under 70 square meters [16][20]. - The market is seeing a shift where institutional investors are also beginning to focus on residential properties due to rising rental yields, contrasting with previous preferences for commercial real estate [20][24]. Group 3: Investment Calculations - Investors are calculating returns based on net rental income, factoring in costs such as property management fees, maintenance, and potential vacancy losses, which can significantly affect perceived profitability [26][28]. - The internal rate of return (IRR) is becoming a critical metric for long-term investors, emphasizing the importance of holding periods in determining overall investment success [28][30].

Core Viewpoint - The average rent per square foot for private residential properties in Hong Kong reached approximately HKD 38.78 in September, with a cumulative increase of about 2.95% over the first nine months of the year [1] Rental Trends - Notable increases in average rent per square foot were observed in properties along railway lines, with some areas seeing over a 10% rise, such as the new Kwai Fong Garden near Kwai Fong Station, Laguna City near Lam Tin Station, and Silver Lake Peak near Wu Kai Sha Station [1] - The convenience of transportation and better living facilities in railway-adjacent properties have made them popular among tenants, contributing to their strong rental performance [1] Specific Property Performance - Properties such as Yulongshan near Fo Tan Station and Xinghe Mingju near Diamond Hill Station recorded nearly a 10% increase in average rent over the first nine months of the year [1] - Other notable increases include approximately 8.9% for the Sky Tower near Kowloon Station, 8.6% for Taihu Garden near Tai Wo Station, and around 7.5% for Kai Wai near Kwun Tong Station [1] - Properties along the Tseung Kwan O Line, such as Tianjin near Tseung Kwan O Station and Blue Bay near Hang Hau Station, also saw increases of about 6.1% and 5.9%, respectively, surpassing the overall market growth [1]

Core Insights - The Brazilian Institute of Economics at the Getulio Vargas Foundation reported that residential rents in Brazil increased by 0.28% in August, higher than the 0.06% increase in July [1] - The year-on-year increase in rents over the past 12 months was 4.08%, down from 5.79% in July, attributed to a high base effect from the previous year [1] - The month-on-month increase in rents for August was 1.93%, compared to only 0.28% this year, indicating a significant slowdown [1] City-Specific Trends - In August, rent increases were as follows: São Paulo up by 0.06%, Rio de Janeiro up by 0.27%, Belo Horizonte up by 0.40%, and Porto Alegre up by 0.59% [1] - Over the past 12 months, Belo Horizonte experienced the highest rent increase at 7.93%, while São Paulo had the lowest at 1.82% [1] Methodology - The FGV's residential rent change index (IVAR) is based on actual lease contract prices rather than advertised prices, providing a more accurate reflection of market trends [1]

Core Viewpoint - The average rental price of residential properties in key cities has experienced a slight decline in the first quarter of 2025, according to a report by the China Index Academy [1] Summary by Sections Rental Price Trends - In the first quarter of 2025, the average rental price across 50 cities decreased by 0.44% [1] - In January, the average rental price for ordinary residential properties fell by 0.4% due to a concentration of migrant workers returning home for the Spring Festival [1] - February saw a rebound in rental demand post-holiday, leading to a stabilization in rental prices with a slight increase of 0.01% [1] - By March, the average rental price in key cities was 35.3 yuan per square meter per month, reflecting a minor decrease of 0.05% month-on-month and a year-on-year decline of 3.40% [1]